General Motors Reconsiders going Bankrupt

Remember when the execs over at General Motors were saying that bankruptcy was not an option? They said that there was no way that the company would choose that alternative -- nada, no way, forget about it.
Well, things have steadily become worst for the Detroit auto giant. Now there are some whispers coming from the towers of GM that, yes, bankruptcy is a viable alternative. It appears that it may not have any other choice if the feds don’t give it more money. The Treasury Department has given GM $9.4 billion. And it estimates that the company needs another $5 billion to survive through the first quarter of this year. Meanwhile, The Wall Street Journal reports that GM is giving the government two alternatives -- give up billions of more dollars in loans or put the company into what is called debtor-in-possession bankruptcy that will call for the government to give the company billions of dollars financing because that money wouldn’t be available from anywhere else. That could cost the government more than if it just loaned the money without the bankruptcy option. The Journal is also reporting that GM could file for Chapter 11 bankruptcy, combine all of its domestic and international assets into a new company and then sell off or liquidate remaining assets in bankruptcy proceedings. This would also allow the company to re-structure agreements with parts suppliers and the union as well as other employees to come up with something that is more favorable for the new company. Our take? We guess it all depends on the business plan GM gives to Congress when it goes up to Capitol Hill to plead for more loan money. Is it bye-bye General Motors as we now know it?